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Artificial Intelligence for Public Use

Author

Listed:
  • Lodefalk, Magnus

    (Örebro University School of Business)

  • Engberg, Erik

    (Örebro University School of Business)

  • Lidskog, Rolf

    (School of Humanities, Education and Social Sciences)

  • Tang, Aili

    (Örebro University School of Business)

Abstract

This paper investigates the economic and societal impacts of Artificial Intelligence (AI) in the public sector, focusing on its potential to enhance productivity and mitigate labour shortages. Employing detailed administrative data and novel occupational exposure measures, we simulate future scenarios over a 20-year horizon, using Sweden as an illustrative case. Our findings indicate that advances in AI development and uptake could significantly alleviate projected labour shortages and enhance productivity. However, outcomes vary substantially across sectors and organisational types, driven by differing workforce compositions. Complementing the economic analysis, we identify key challenges that hinder AI’s effective deployment, including technical limitations, organisational barriers, regulatory ambiguity, and ethical risks such as algorithmic bias and lack of transparency. Drawing from an interdisciplinary conceptual framework, we argue that AI’s integration in the public sector must address these socio-technical and institutional factors comprehensively. To unlock AI’s full potential, substantial investments in technological infrastructure, human capital development, regulatory clarity, and robust governance mechanisms are essential. Our study thus contributes both novel economic evidence and an integrated societal perspective, informing strategies for sustainable and equitable public-sector digitalisation.

Suggested Citation

  • Lodefalk, Magnus & Engberg, Erik & Lidskog, Rolf & Tang, Aili, 2025. "Artificial Intelligence for Public Use," Working Papers 2025:6, Örebro University, School of Business.
  • Handle: RePEc:hhs:oruesi:2025_006
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    References listed on IDEAS

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    More about this item

    Keywords

    Artificial intelligence; Implementation of technology; Productivity; Labour demand;
    All these keywords.

    JEL classification:

    • E24 - Macroeconomics and Monetary Economics - - Consumption, Saving, Production, Employment, and Investment - - - Employment; Unemployment; Wages; Intergenerational Income Distribution; Aggregate Human Capital; Aggregate Labor Productivity
    • J23 - Labor and Demographic Economics - - Demand and Supply of Labor - - - Labor Demand
    • J24 - Labor and Demographic Economics - - Demand and Supply of Labor - - - Human Capital; Skills; Occupational Choice; Labor Productivity
    • N34 - Economic History - - Labor and Consumers, Demography, Education, Health, Welfare, Income, Wealth, Religion, and Philanthropy - - - Europe: 1913-
    • O33 - Economic Development, Innovation, Technological Change, and Growth - - Innovation; Research and Development; Technological Change; Intellectual Property Rights - - - Technological Change: Choices and Consequences; Diffusion Processes

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